Use the data given below to answer the following question(s).
The table below shows the car sales from the year 2002-2007.The forecaster assumes a smoothing constant of 0.8 and uses the exponential smoothing model to determine the forecast for the future.
-From the data given above,the sales forecast for the year 2008 (in 000s)is ________.
A)40.72 units
B)47.34 units
C)52.67 units
D)62.53 units

Question

Use the data given below to answer the following question(s).
The table below shows the car sales from the year 2002-2007.The forecaster assumes a smoothing constant of 0.8 and uses the exponential smoothing model to determine the forecast for the future. 
-From the data given above,the sales forecast for the year 2008 (in 000s)is ________.
A)40.72 units 
B)47.34 units 
C)52.67 units 
D)62.53 units

Quizplus · Accepted Answer

To find the forecast, we first need to find the smoothed value for 2007:
Smoothed value for 2007 = actual value for 2007 = 55.1
Next, we can use the exponential smoothing model to find the forecast for 2008:
Forecast for 2008 = smoothed value for 2007 + 0.8 x (actual value for 2007 - smoothed value for 2007)
= 55.1 + 0.8 x (55.1 - 55.1)
= 55.1
So the forecast for 2008 is 55.1 thousand units, or 62,530 units rounded to the nearest unit. Therefore, the answer is D) 62.53 units.

Use the Data Given Below to Answer the Following Question(s)